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TESS VIGELAND: Today the US Supreme Court agreed to hear a case that could force the issue on global warming. This fall the high court will consider whether the Bush Administration must regulate carbon dioxide emissions. But who’s got more at stake? The auto industry or environmentalists worried about climate change? Marketplace’s Hillary Wicai reports from Washington.

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HILLARY WICAI: We all breathe it out. And our cars belch it big time. It’s a key culprit in global warming, but is carbon dioxide a pollutant? California and 10 other states say it is and they want to have the Environmental Protection Agency regulate it. Senior attorney David Bookbinder is with the Sierra Club.

DAVID BOOKBINDER:“EPA has an obligation under the Clean Air Act to regulate ‘any pollutant that is injurious to human health or welfare.’ And the Clean Air Act actually defines ‘welfare’ to include ‘bad effects on climate.'”

But in 2003 the EPA decided not to regulate carbon dioxide emissions from new cars and trucks. The agency said Congress didn’t mean to address climate change in the Clean Air Act so, strictly speaking, CO2 is not a pollutant under that law. That’s when the states and other environmental groups sued. But the oil and gas industry says the EPA’s refusal to regulate is A-OK. Russell Jones is with the American Petroleum Institute.

RUSSELL JONES:“Because, we don’t think that the Clean Air either requires or authorizes that. So we think EPA is interpreting the law properly.”

If the High Court disagrees that raises the specter of new regulations on automakers. Gloria Bergquist is spokesperson for the Alliance of Automobile Manufacturers.

GLORIA BERGQUIST:“Mandates can be at odds at what vehicles consumers want to purchase and so that puts us at odds with our customers.”

And being at odds with customers isn’t exactly where an already struggling industry aspires to be.

In Washington, I’m Hillary Wicai for Marketplace.